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    Joan Lloyd's HR Words of Advice: Pay-for-Performance
    Joan Lloyd
    <strong>Dear Joan:</strong><br />
    I am a reader of your weekly column, and was hoping that you could provide guidance on the situation described below. <br />
    <br />
    I work for a Federal government agency, with a pay-for-performance system. Under the system, an employee's twelve-month performance is compared to their work peer group. <br />
    <br />
    The performance is then rated and assigned a pay category. The pay categories are as follows: Category 1 - 6% raise and a lump sump payment; Category 2 - 4% raise, and a lump sum payment; Category 3 gets a 2% raise. A grading curve/scale is strictly followed, with 25% of the employees being put in Category 1, 50% in Category 2, and 25% in Category 3. Supervisors are instructed to slot their employees into these three categories, and the percentages in each category must be followed. <br />
    <br />
    In 2006, I worked 7 of 12 months in the evaluation period. The other 5 months were spent on maternity leave, with a combination of FMLA leave, sick leave, and leave without pay. Thus, my performance was ranked in Category 3, because I didn't have as many accomplishments as my other colleagues who worked for the entire year. Thus, the system appears to have a disparate impact on employees who are gone for an extended time, such as on maternity leave or other FMLA leave. <br />
    <br />
    In the past, my ratings have been good, so I feel that the rating was unfair. I think my performance should be based on the context in which it was performed. I am concerned because this system is used in our entire agency, and I know that others have faced a similar situation with similar rating outcomes. <br />
    <br />
    I plan on filing a grievance with our Union, and was possibly thinking of a more serious action of obtaining an attorney. I would sincerely appreciate your guidance on this matter. Thank you for you time and consideration.<br />
    <br />
    <strong>Answer:</strong><br />
    I think you are only seeing this situation from a foot off the ground, when a 20,000-foot view is needed. Since your manager is forced to compare your work to your peers’ for the entire year, how can she justify giving you a higher rating/raise, when you were only there a little over a half year? <br />
    <br />
    Because she is forced to use a bell curve, she would certainly want to put her top performers, who worked all year, into the higher categories. A 2 percent raise for seven months seems more than fair to me.<br />
    <br />
    I have a hard time seeing how this could be grounds for a grievance or lawsuit, when you indicate that everyone else seems to be treated the same way when they are out for a significant part of the year. <br />
    <br />
    And since your performance review and salary are only an assessment of this year’s work, it has no connection to how well you did last year. Because you were a good performer last year (and no doubt, for years before that) your rating and raise will likely bounce back and you will be back in the 6 percent category next year.<br />
    <br />
    In fact, how would you feel next year, after turning in a stellar performance all year long, if someone who worked only seven months got a six percent raise, knocking you into the four or two percent category? <br />
    <br />
    I agree with the supervisor. She did what she thought was right—to portion out the most money to the people who were doing a good job all year long. <br />
    <br />
    <strong>Joan Lloyd</strong> is an executive coach, management consultant, facilitator and professional trainer/speaker.  Email your question to Joan at <a href="mailto:info@joanlloyd.com">info@joanlloyd.com</a>.  Joan Lloyd & Associates, (800) 348-1944, Visit <a href="http://www.joanlloyd.com/">www.JoanLloyd.com</a> © Joan Lloyd & Associates, Inc.<br />


     
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